Submit Feedback
Member Login
About Transparency
 Discussion List
|
Previous Page
Group OrganizerBuzzword of the year - Transparency
So why is this word important? What makes it seemingly relevant to today's real estate experience? It is so critical because we have practiced the opposite for so long. We have offered consumers something we called "full service" for as long as any of us can remember. But, by the way, we rarely told them what this "full service" included! Thus, we practiced unintentional deception. No, we didn't lie. No, we never set out to deceive anyone. It is just that we assumed that everyone knew what full service entailed.
A problem was that most consumers never knew going into a transaction what would happen between posting in the MLS and getting the closing check or the keys to their new home. We practiced unintentional deception. Consumers generally think that we do far less than we really do for our fees. "If you don't tell me what I am paying for, I am not very thrilled about giving up my money." Yet we have unknowingly asked consumers to do exactly that.
What constitutes full service varies greatly from one professional to the next. One might include staging, another might not. One might include mail campaigns and Internet promotion, another might not. Some may include all closing services, others may charge extra. Whatever you include or exclude, one thing is clear: consumers probably don't know what to expect. Yes, sometimes we offer them a written marketing plan. Sometimes we give them a written "what to expect" brochure. Usually, though, they neither understand this nor have a clear fix on what they are paying for.
Add to this confusion the reality that we, as competing professionals, often give services away in the hope of winning the "deal" from others. These "freebies" are sometimes services that are outside the normal: staging, landscaping, interior repair and refurbish are all things I have seen given as free services, even thought they were never part of the "standard" set of services in our area. This tends to tell the consumer two things:
1. These are valueless services
2. These are what we normally pay for.
They are valueless simply because we are willing to do them for free. I believe that free services are always seen as having a value equal to what the consumer pays for them.
They become viewed as services that are assumed to be integral to our offering, simply because we make such a big deal about them. "They must be standard." We know, by the way, that these services are not part of the usual, and are not critical parts of what we do. They were "invented" often to inflate our individual offering to put us just a little ahead of the pack. We place so much importance on them in our competitive plan that consumers sometimes think of these as our service offering - missing the real important issues like marketing, negotiation, contracts, disclosures, inspections, closings, and so much more. So, listening to us puff about these "put me first" ancillary services and not hearing much about our critical services, it is small wonder why consumers might sometimes think we are overpaid.
So, back to transparency. It is high time to educate ourselves and our clients as to what it is we do for a living. And, by the way, how we do this education will speak volumes about how professional we are. Do it right and you are viewed as a true professional, skilled in all aspects of residential real state business. Do it some other way and you can be seen to be like just another discount shop - giving away services but never really performing to the consumer's expectation. They don't understand what you do and you don't understand what they expect.
What do we mean by transparency? It is simply the method of doing business that gives the consumer a clear understanding of all the things you will do for them and the costs associated with those services. It is allowing the consumer to understand these services in such a manner as to empower them to make correct choices about the services that they will want or need. It is then structuring the business agreement in such a way as to spell out in clear terms the expectations of both the professional and the consumer, transparently.
Then, you must perform to expectations.
Jack Harper
Copyright 2008, Jack Harper, All Rights Reserved
www.clientchoicerealty.com
- Edited by Jack Harper on Nov 19, 2008 8:14:33 AM
To Top
Quote
Reply
Group Memberhi jack,
as a real estate broker for 15 years, and an entrepreneur for the same period, i believe you are right on the money with this one. Well written, and i hope who ever reads this piece, will take to heart how important it is to be as clear, concise, and specific as we can. That is just good business and eliminates room for confusion and miscomunication.
Good job,
dan Cheadle, CEO AdvantageML.com
Group OrganizerDan states:
as a real estate broker for 15 years, and an entrepreneur for the same period, i believe you are right on the money with this one. Well written, and i hope who ever reads this piece, will take to heart how important it is to be as clear, concise, and specific as we can. That is just good business and eliminates room for confusion and miscomunication.
Thanks, Dan. I and many others feel strongly that our shift to total transparency in our client relationships is the base for our future business model - whatever form that takes.
JackH
Group Organizer
How do you practice transparency?
So much has been written about the need for transparency in real estate. Like anything else, there are about as many definitions of transparency as there are agents.
What does this mean to you? And, how do you apply it to your daily practice?
JackH
Group MemberHi, I am new to this group and have a few questions. I have only been in real estate 4 years and have definitely witnessed the change in the way business is being conducted (or should be being conducted...) I am trying to think out of the box and ahead of the curve of the conventional agent mentality. What that being said, here are my thoughts:
I think about "transparency" all the time, although I am not sure I have ever called it that :)...I have tried to define "tiered services" as offerings and a way to offer discounts, so-to-speak. With this approach you are putting out there to the prospect a service menu, right? And the goal is to upsell, of course.
As far as "consulting" goes, aren't there different regulations in each state that say this is a grey area under the traditional brokerage model? I recall one broker I worked for saying that I couldn't have the term "consultant" listed on my business cards...and how are the 'fees for services' handled with your brokerage?
Group OrganizerHi, I am new to this group and have a few questions. I have only been in real estate 4 years and have definitely witnessed the change in the way business is being conducted (or should be being conducted...) I am trying to think out of the box and ahead of the curve of the conventional agent mentality. What that being said, here are my thoughts:
I think about "transparency" all the time, although I am not sure I have ever called it that :)...I have tried to define "tiered services" as offerings and a way to offer discounts, so-to-speak. With this approach you are putting out there to the prospect a service menu, right? And the goal is to upsell, of course.
As far as "consulting" goes, aren't there different regulations in each state that say this is a grey area under the traditional brokerage model? I recall one broker I worked for saying that I couldn't have the term "consultant" listed on my business cards...and how are the 'fees for services' handled with your brokerage?
Hi Wendy and welcome.
By transparency, I mean that we actually educate the client as to the exact services that we offer and the cost for each service based on required skill level and hours to complete. Once armed with this knowledge, the client can then choose to have me perform each service or not perform each service. I call this the informed decision process. This is not at all to be construed as a way to "discount." It is a way to have an informed agreement between the client and myself.
I do not agree that the objective is to "upsell." In my view, the objective is to provide skilled services to clients who select those services. This is in contrast with the traditional model of "selling" something called "full services" which are undetermined services for an undetermined fee (because it is based on an undetermined sales price at the time of our agreement).
Yes, in fact I do present a menu of services to each client, in the form of a Needs Analysis worksheet that is designed to explain all of my offered services, costs and times associated and becomes an agreement for services once the client selects the ones he/she wants.
Now, I am in the middle of writing an article that should help explain how to market these services to clients in such a way as to actually add business that I would likely not get under the traditional method. So, in that regard, this does not require me to "upsell" to get back to even.
As to the different states, you are correct. Each state treats licensees and brokerages differently. Some do not allow you to call yourself a "consultant" unless you are a broker. Some do not allow unbundling (under the guise of "minimum service laws and regulations). The outlinne for each state can be found at http://www.usdoj.gov/atr/public/real_estate/fee_details.htm
Hope this helps
Jack H
Copyright 2009, Jack Harper, All Rights Reserved
- Edited by Jack Harper on Jan 13, 2009 12:09:11 PM
GuestHi Wendy,
If only every agent who were fairly new to the real estate business thought the way you do we'd all be better off ;-) I always think about transparency as well, but like you - in years past, never called it that. I considered it being honest and giving choices that met the needs of the client. Same thing, different name.
You are in PA, one of the only States that I know of that can't call themselves a consultant UNLESS you happen to have your Brokers license. I don't know why that is, but there are a lot of agents who are upset about it in PA and trying to get the law changed.
Since you will be unable to call yourself a consultant, unless you get your Brokers lic., thus marketing those services and being able to work in that capacity, I will give my .02 on how to split the fees with your Broker for the benefit of those who do not live in PA.
The easiest way to do this, without it becoming an accounting nightmare is to use the same split as you are on if you did a traditional commission based transaction.
In the long run, it is something you and your Broker have to address and work out between yourselves though. I have also seen agents get their Brokers lic, start up their own business and keep all of the money too, and a myriad of other ways, but you have to work it out for yourself. As with the consulting model, there is no one size fits all.
Hope this helps! Now go get your Brokers license so you too can offer consulting ;-) it's cheaper than moving to another State (which I've also seen agents do!)
Group MemberHi Paula,
Appreciate your insight. I knew I wasn't crazy about not being able to call myself a consultant in PA!
Guestbtw Wendy, a great agent friend of mine who used to live in PA, and was the former Realtalk managing editor may also have some insights to share with you regarding changing the laws in PA. I don't know how far so got with that before she moved to AZ and is now the big mucky muck for Trulia, but if you would like to email her to see if she can be of any assistance, her name is Frances Thorsen and she has a profile still here on RT.
I believe you can reach her by Fran@TheRealtyGram.com. I just spoke to her the other day and she was in NY for a convention, then has to go to San Francisco, so not sure if she would have a lot of time in the near future to address this but she is a wonderful, caring, giving and sharing person and knows much about the laws in PA since she lived there for so long.
Paula Bean in sunny Orlando FL - we have a cold front coming through tonight though, I'll have to drag out the heavy clothes, it's supposed to get down to the 50's with the highs in the 60's ~ BRRRRR!
|
Discussion List
|
Word of the Day
Ask the Experts
Question of the Day
My Subscriptions
My Group Invitations (0)
My Posts and Drafts
Manage Groups
Rules of the Road
Posting Tips
Member Login
Join RealTown
Request Password
